Thursday, June 13, 2024

After Sri Lanka, it’s Pakistan now in grips of surge in fuel prices

Pakistan Finance Minister Miftah Ismail on Thursday announced a substantial surge in the price of petroleum products. 

The move comes after the International Monetary Fund (IMF) recently underscored the elimination of commodity subsidies. 

In a press conference, FM Miftah Ismail announced that the Sharif government has decided to raise the price of fuel, diesel, kerosene oil and light diesel by Rs 30, which come into effect from May 27. 

The revised rate for Petrol will stand at Rs 179.86 and that of Diesel will be at Rs 174.15, Kerosene oil at Rs 155.56 and Light diesel will be Rs 155.56.

A day earlier, Pakistan and the IMF were unable to reach an agreement at the staff level after the Fund noted that there were disparities between the policies agreed upon by both parties. 

Notably, the former PTI regime had first agreed in February to the IMF’s demand that prices for power and petroleum products should be hiked, however, the now-ousted Prime Minister Imran Khan back then announced subsidies on both commodities in March, and the incumbent Sharif government was continuing with the same arrangement.

The Pakistan Finance Minister stated that inflation will almost certainly surge due to the hike in the price of petroleum products. Ismail also stated that if prices had remained unchanged, the country may have gone on the wrong path and that Prime Minister Shehbaz Sharif had had to make a choice, according to Geo TV. He further stated that Prime Minister Shehbaz Sharif’s decision to increase the price of petroleum items by Rs 30 was not an easy one. However, he further added that the present administration will take any necessary steps to protect the economy. The Pakistan FM also said that for the sake of politics, they cannot let the state drown.

Miftah Ismail also stated that the government’s shortcomings are that inflation is rising but that they have provided commodities subsidies at utility stores. He also claimed that they are making sugar available at a lower cost than Imran Khan’s government. In the meanwhile, earlier, reports emerged that Pakistan would require financial assistance in the range of $9-12 billion till June 2022 to avoid further depletion of foreign currency reserves due to a widening deficit of USD 13.2 billion in the first nine months and payback obligations on external loans, according to media reports.

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